IT Salaries Edge Up Back To 2008 Levels 266
tsamsoniw writes "A soon-to-be released salary survey finds that the average salary for IT professionals in the U.S. is $78,299, putting overall compensation back at January 2008 levels. More heartening: Midsize and large companies are both aiming to hire more IT pros. The midsize are seeking IT executives (such as VPs of information services and technical services), as well as programmers, database specialists, systems analysts, and voice/wireless communication pros. Enterprises are moving IT and data center operations back in-house, which means greater demand for data center managers and supervisors."
Average (Score:5, Insightful)
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I wish they'd report median salary more. It's probably much lower. Executive pay is ridiculous. Even IT executives.
Re:Average (Score:5, Insightful)
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Yes, fringe benefits -- they can use the stock to wipe their asses after getting laid off.
Re:Average (Score:5, Interesting)
You call this going up?
I made $85k in 2001, before 9/11 and before my layoff (after 10 years in IT) Ever hear the saying, "If you're out 6 months, you're back at square one?" It's true.
The economy is fucked as ever. The kids they're paying $78k to have vastly more talent than I ever did, and had they been getting paid 2001 wages, would be making closer to 130k if not more.
Re:Average (Score:5, Informative)
Stop bitching and follow the money. Some of us are making the 130k even though the economy is "fucked".
Or you're still pimping your vertas+solaris skills and not following the buzzwords. There's at least another year on the cloud train, time to hop on it buddy.
Re:Average (Score:4, Insightful)
Re:Average (Score:5, Informative)
No shit. We are almost done virtualizing our entire datacenter, I assume the next step is to realize that having a single point of failure for 20 virtual servers isn't as cool as having 20 dirt cheap real servers, each independant.
What are you virtualizing them onto? If it's a big machine that's highly redundant, then the "single point of failure" mantra is false. On a big iron machine where you can hot-swap power supplies, hard drives, memory, CPUs without missing a beat, there is no single point of failure, and you get much higher availability than 20 dirt-cheap servers where something could break at any time.
Re:Average (Score:4, Insightful)
Step 1:
Consolidate onto virtualized servers.
Step 2: create multiple VM hosts with high-availability
Step 3: set up redundant networking (switches, etc)
Im not seeing the problem, nor the single point of failure. In fact, virtualization is much cooler than those crappy servers, since you can take a server offline without taking the service offline by migrating a guest between hosts. That is, in fact, one of the main reasons you use virtualization to begin with-- to disassociate the service from the piece of hardware.
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I don't agree. The premise of successful virtualization is that you're not utilizing the hardware most of the time. This is quite true for some workloads, but not all. I don't believe virtualization works for disk bound workloads. I've never seen evidence that it's a good idea.
Specifically, I think virtualization is terrible for database servers. There are also cases that mail servers could be a problem.
Let me give an example. I know someone that works at a large company and they have clusters of mysql
Re:Average (Score:5, Insightful)
You seem to be completely missing the context here.
First, 2001 was still during the hey-day of the dot.com bubble. You're upset that you aren't earning as much as you think you should be, but here I missed out on the bubble entirely, as really Jr. level people I worked with were getting $150,000 job offers as soon as they got some certification or other...
I know it sounds harsh, but you need to consider the possibility that you weren't ever worth $85k, and you were lucky enough to have been getting an insanely inflated salary for a few years. It's "found money" to you.
And the 6-month rule? Did you happen to notice that the dot.com bubble burst around that 6-mo period? I very, very seriously doubt that was anything but a coincidence. It's really not like your skills are out of date in 6-mo, as I'm still impressing some very higly paid pros with lots of stuff I was doing a decade ago. I wouldn't even note the gap on my resume, and I've yet to find a company that cares enough about about minutae to track down exact employment dates, rather than just confirming rough details, and making sure your references aren't giving an unenthusiastic endorsement.
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Tech unemployment in the Bay Area is currently 3%. Fucked.
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Yep. I've been told it's 2% here in Madison.
Re:Average (Score:4, Insightful)
No offense intended, but generally speaking a sizable portion of the group will be paid below average. Perhaps you're just part of that group?
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Yes, but if they're just reporting an average salary half of the people will be getting below average salaries. It's a lot more informative if you get mean, median and standard deviate. Preferably with some indication of how the samples are distributed.
A mean alone is of very little value unless you've also sorting things in a way that makes sense. For instance a mean that covers the entire country is going to be somewhat worthless as one could be making a good salary in one part of the country and effectiv
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Exactly. In Hollywood, CA, you are paying $1million USD for mortgage a one bedroom living space, where in rural PA, you could pay $40k USD for a 4 bedroom, 3 story house.
I don't think either of those things are true.
Re:Average (Score:4, Informative)
Re:Average (Score:5, Informative)
"Yes, but if they're just reporting an average salary half of the people will be getting below average salaries."
Nope. Given the usual pay scales, far more than half the people will be getting below average salaries. Exactly half the people will be getting below the median salary. Different things.
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"Yes, but if they're just reporting an average salary half of the people will be getting below average salaries."
Nope. Given the usual pay scales, far more than half the people will be getting below average salaries. Exactly half the people will be getting below the median salary. Different things.
No, far more than half the people will be getting below the mean salary. The word "average" can refer to mean, median, mode, or other things.
If you're going to be pedantic, check a dictionary first.
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generally speaking a sizable portion of the group will be paid below average
nearly half!
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Well more than half. There's typically a few management types at the top skewing the curve.
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Same here. I look at IT salary statistics, even ones drilling down to "software engineers" or "software developers" and I end up crying. Sure, I live in a part of the country with a lower cost of living, but so do most people in my career. Am I really getting the shaft that bad?
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The number if IT workers admitted on H1-b visas is also at a 10 year low.
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It also depends on what exactly your job is. As a programmer, I make double that with stock. It's actually not too far from what I made at my first job ten years ago. Help desk will make far less. Lumping everyone together makes these surveys useless. It's like averaging nurses with surgeons and reporting an average "medical field" salary. Pointless, noone makes that- they make far more or far less.
My Salary (Score:5, Interesting)
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Please... (Score:4, Informative)
Please let my boss know.
YOU must let your boss know (Score:5, Insightful)
Your boss isn't going to go out of his way to pay you more than he thinks he needs to in order to retain you. The only person who will always have your best interests at heart is you. YOU must ask your boss for a raise and present evidence that your market value has risen to justify it.
If he doesn't pay up, jump to a new job that will. Apparently, there are some openings now.
Re:YOU must let your boss know (Score:5, Insightful)
Because if you have 10 employees, two of them have to be at the bottom. Even if they're all awesome.
When the power to give raises and adjustmeents is out of your boss' hands, the whole idea of "just go ask for a raise durpa durp" is kind of silly.
Exactly. This is why, if you want a raise, you just need to quit and go find another job. Companies will give higher salaries to new employees to get them in, but their dumb HR policies prevent them from giving substantial raises to existing employees, so you'll do better switching companies every 3-4 years.
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That's probably so, but what are the odds that you're going to find multiple companies in your area needing the exact skills you possess, and happen to be hiring right when you are looking?
I may be making good money, but I've also done large moves, 3 times in the past 4 years following different jobs. How much of a pay cut is it worth to live in the city/county/state you like, and being able to stay in one home for several years at a time?
How many years
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in-house (Score:2)
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No. Different employees are getting different jobs. Those other jobs? Those jobs are gone. It's dynamic.
Hmm... (Score:2)
I really have to relocate to the US.
Seriously, people, is that figure for real?
Re:Hmm... (Score:5, Insightful)
Yeah, with two caveats.
1) That assumes you have a job. Lots of unemployed IT people and IT people working in other professions aren't counted.
2) A lot of these jobs are in high cost of living areas like New York City or Silicon Valley. When a 1BR apartment costs north of $2000/month, $80k/yr gross doesn't seem like so much.
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Only 2?
3) Higher salary puts you in higher tax bracket as well... I'm actually comtemplating going back to a job that paid half as much as I'm making now, because after increased taxes and higher cost of living, I have very little extra take-home to show for the miserable working conditions.
It's amazing how housing prices can increase/decrease by more than an order of magnitude within a 30 minute drive.
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Tax brackets cause a salary figure to be highly misleading. And this thread is all about someone reacting to a salary figure that only looks/sounds impressive. Of course it's not a reason to eg. refuse a raise. However, in the real world, a higher salary doesn't come along in a complete vacuum.
In my case, which I laid out, the COMBINATION of higher tax bracket PLUS higher cost of living, and higher demands of a supposedly higher payin
Re:Hmm... (Score:4, Insightful)
So, no families?
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On the other hand, our unemployment rate in Nevada is the worst in the nation (13%+ in Reno, more than that in Las Vegas), starting IT salaries out here are at $25k/year with most people peaking out somewhere in the $50k range after a few years, there are never more than 30 job listings on Dice.com, and the vast, vast, vast majority of IT jobs
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And you can make more outside of the San Francisco area (or, at least, I could - YMMV). Don't get me wrong. I loved living in the Bay area, but when I got the offer for more money (and a more interesting job) in a place where I could buy a house twice as big as my Fremont house (and for less money with a much shorter commute), I couldn't pass it up. I always thought that I'd gotten premium pay for working in the Bay area, and putting up with the high prices and long commutes, but it turned out not to be
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No, these are actually imaginary Canadian dollars, which are worth much, much less than real American dollars.
As of this writing, an American dollar will purchase 1.02 Canadian [bankofcanada.ca] dollars. I admit that I was surprised. I stopped following it for a while, but I had thought the Canadian was worth more. What did Canada do to screw up their economy?
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No, these are actually imaginary Canadian dollars, which are worth much, much less than real American dollars.
As of this writing, an American dollar will purchase 1.02 Canadian [bankofcanada.ca] dollars. I admit that I was surprised. I stopped following it for a while, but I had thought the Canadian was worth more. What did Canada do to screw up their economy?
You have it backwards: the CAD per USD [goo.gl] ratio hasn't gone much above 1.07 CAD per USD in the last 10 years, and used to swim in 0.75 territory for the longest time. Hence the well-known phenomenon of books and magazines with two list prices, a US price plus a Canadian price that's a good nudge higher. That suddenly became obsolete when the CAD achieved rough parity around 2007 or so, in part because of the USD inflating a bit faster than the CAD.
Re:Hmm... (Score:4, Informative)
What did Canada do to screw up their economy?
The value of the basic unit of currency has little to do with economic strength. (If you doubt this, consider that a Mexican Peso is worth 7 times a Japanese Yen).
The Canadian dollar, and the Australian dollar, have a correlation to commodities. As commodity prices went up, so did the Canadian dollar.
That's not the only thing that affects the exchange rate, though. It's a supply/demand thing. Over the last 6 months, demand for the US dollar has jumped, because of the European crisis. So it isn't the Canadian dollar that has dropped so much as the US dollar that has risen.
The Orwellian Truth (Score:5, Interesting)
And my compensation package in 1999 was roughly $80,000/year. Things have improved how? Those numbers are still LESS than I made 13 years ago!
Wasn't it in 1984 that someone was told to say the government increased the chocolate ration to a lower number than previously?
Re:The Orwellian Truth (Score:5, Insightful)
1999 was in the middle of the dot com bubble. You might as well be a real estate agent complaining you aren't making as much as 2006.
Also, I have no idea what technology you worked on then compared to now to assess your statement.
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The "bubble" was a sham and an excuse to cut everyone's pay. Nothing more.
The only people who weren't needed after Y2K were the mainframe programmers who'd upgraded the old systems. I and all but two people on a team of twenty were on projects that had NOTHING to do with Y2K and were kept on LONG after that.
But not before we all got raped into taking a forced pay cut. My staff were NOT happy when I presented them with their pay packages, renegotiated on an entirely one-sided basis: take it or leave.
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Every single employer in the region did this. Not just J. P. Morgan. Everyone. Even "new" industries that had no legacy systems.
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Shortly after I said "Fuck the US" and moved back to Saskatchewan. Thank God I left before the TSA started groping people on subways at random.
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Here's another few points to consider:
I had to move back to Saskatchewan for health reasons, but not until I go
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No one ever seems to get away without being screwed by American greed. Personally. No matter where they come from. No matter how skilled they are. No matter their ethics. Anything to feed the executive and shareholder payroll.
Re:The Orwellian Truth (Score:5, Funny)
We have managed to increase the decline of productivity!
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As a staff manager, I knew what other people were being paid. My salary was very typical across a pretty broad range of experience levels.
And so what if it was the tail end of the Y2K bubble? That means people should still be getting paid less after 13 years of inflationary pressure on their actual disposable income?
Drink that government Koolaid. All is right with America. Just trust The Great Leader.
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And my compensation package in 1999 was roughly $80,000/year. Things have improved how? Those numbers are still LESS than I made 13 years ago!
Wasn't it in 1984 that someone was told to say the government increased the chocolate ration to a lower number than previously?
Ah. This article isn't about you. It's about average IT professionals, in the real world. When the Narnia survey hits we'll let you know.
Seriously though. I am concerned about people who think that average salaries going up is a good thing. Imagine a system where if YOUR pay goes up, everyone's pay goes up and suddenly you're paying ten dollars for an apple. Who's better off? There's the world now.
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I'd like to live in such a system as it's better than what we have currently. What we have currently is a system where most people's income goes up less slowly than inflation and the various costs of living and a tiny minority's income sky rockets during a recession.
Compared to your alternative where ones income would be going up at roughly the same rate as inflation, I know what I would take.
Re:The Orwellian Truth (Score:4, Insightful)
Does it matter that you're underemployed as long as unemployment is down? That's what "they" are counting on us forgetting to stay in office.
They don't care if you don't have a job ... as long as you've given up looking. Then you're not counted in the unemployment figure. The "unemployment" rate is meaningless without also looking at the Labor Force Participation Rate [bls.gov].
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Which is one of the reasons why it's good to be in a country with a guaranteed standard of living and why it sucks to be poor in America.
We spend so much money ensuring that people won't get more than they've earned that we end up ensuring that most people end up getting a lot less than they've earned. What's worse is we don't pay any attention to people plundering the economy when they do it via white collar crime.
Except for inflation... (Score:5, Informative)
According to the inflation rate calculator I used, the consumer price index (one measure of inflation) has increased 5.08% from 2008 to 2011.
So, on average, IT pro's are effectively paid about 5% less than in 2008.
Quick! get Bill Gates before Congress! (Score:2)
Quick! corporations need more cheap foreign labor to suppress wage increases, Call Bill Gates to testify before congress again!
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According to the inflation rate calculator I used, the consumer price index (one measure of inflation) has increased 5.08% from 2008 to 2011.
Sounds like it's based on CPI, so it doesn't account for food doubling/tripling or the cost of energy.
'Cause real people don't have those expenses...
Oversupply *and* higher wages? (Score:5, Interesting)
I've noted two trends in the job market lately: the jobs are paying a good deal more, but there are a lot fewer of them. It seems counter-intuitive because an oversupply of candidates would tend to drive wages down. However, what I see happening is companies almost *want* to pay top dollar...but only because they want absolutely stellar, walk-on-water, can-do-no-wrong, all-that-and-a-bag-of-chips candidates. I'm making *more* than I was during the dot com bubble. I'm also working my ass off managing projects that would've taken a team of people to do a few years ago. They're certainly getting their money's worth, but I have no room to complain because I'm making top dollar. And that's just how they want it: I have no incentive -- and no opportunity -- to jump ship for something better paying because I'm already way above the average wage, and a less stressful position would pay me so much less that it's not worth searching for.
everything was going fine until the revolution (Score:3)
i dont know what happened! we payed like 1000 guys top dollar to run society, and then all of a sudden these unwashed masses show up, screaming about 'food' and 'medicine' and 'water'. the fuck? maybe if we just payed them MORE, they would do a better job, and all the masses would shut up.
Re:Oversupply *and* higher wages? (Score:5, Insightful)
I'm making about a third of what I was making in 2001. Back then I was a stressed out asshole. I was responsible for keeping A large "bookseller" connected to the Internet and making 6 figures. After a string of jobs doing much the same, I burnt out. I'm glad I put my money into a fixer-upper in a good neighborhood. Sold that for a nice profit and now own a smaller home with no mortgage. Now instead of sitting at a desk playing George Jetson I'm out in the field fixing problems for people. Not big problems, more of the get the credit card machine working again or upgrade the VPN router type. 2-4 jobs most days, just drive there in my car. I get to meet all sorts of folks, save the day and on to the next job. Sure, I could make much more but my sanity and well being is worth than the pay cut. I'm happy, my wife is happy, and I don't get calls at night when something breaks.
Prisoner, I hope you're still young and have time to save money so you don't have to stress all your life. The cubical can eat your soul. Plan so you can have a way out someday.
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It makes sense that companies would want to pay top dollar for stellar software developers, given that (I would assert that) the variance in developer quality is generally greater than the variance in developer pay. Presumably this extends to other positions and fields too.
It's all about bang for the buck, and if you can get someone three times as productive as an average developer (for some reasonable definition of "productive" and "average") by paying that person two average developers' salaries, it's th
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I've written about this before. There is no incentive for companies to hire anyone except the very best. If the best are too busy, the companies can just wait it out until they become available. Unlike sectors that have been major employers in the past, like agriculture and manufacturing, where the is a physical demand to get the job done now, information-based jobs have no such limitations.
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I see a similar thing here. We're a small software company and we're providing top notch enterprise-scale solutions as fast as we can bang them out. It almost seems that our attempts to slow things down by raising prices only increases demand and we're gasping to keep up.
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And with all that extra money you can buy Maalox, Tums, Excedrin, and sleeping pills for the stress.
If you value money above all else, it's what you'll get.
need to hire people who went to tech school not CS (Score:2)
CS is not a different way of saying Software Engineering. CS is about how computing works and more efficient ways to do it (like improving the algorithmic efficiency of sorting), not about how to efficiently and effectively produce 1 000 000 lines of code dedicated to special case X (e.g. flying a plane). Some fields are like that, there's a difference between being a physicist (perhaps a mathematician might be more accurate even in some contexts) and an engineer too.
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odd, my cs degree had a software engineering class
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Then CS and SE need national level organizations and professional licencing associations in every state like medical doctors, lawyers, architects and electrical engineers do. Because every time someone says "I'm a CS major" or "I'm a SE major" half the people (particularly the non-technical ones) mentally roll their eyes and think "computer programmer" or "web master".
The tech / IT feld needs apprentice systems. (Score:2)
The tech / IT feld needs the apprentice systems so people can get the skills to do the job and so we have people who know what they are doing. Tech school is a good starting point but for most tech jobs 4 years CS is not.
Federal workers could sure use that raise (Score:5, Insightful)
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But you probably get a pension which is worth at least 20k a year....
Many "highly compensated" developers in the private sector don't even get matching 401ks anymore, so you can estimate salary - $17,000 (max 401k contribution).
Nope. After 1980-some-odd all federal employees get a 401k with 3% matching. There's a modest pension if you stick it out 30 years, but you gotta make it the full term.
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Raise? What raise? The OP states that wages are just now getting back to 2008 levels. That means, of course, that between then and now they actually WENT DOWN! Did that happen to the public sector? No? Everybody I know has seen wages fall or at best stagnant for at least the last four years. If your pay freeze hasn't been at least that long, you have nothing to complain about.
But go ahead and explore your options in the private sector. I think you'll be shocked at what passes for "benefits" on this side of the line.
Actually I worked in the private sector until 2010, and took a 20% pay cut for those very same benefits as well as the annual raises I was expecting. The benefits have been good, but not good enough to outweigh the lack of raises for 2 years.
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Total myth that federal workers make less than private sector employees. Federal salaries are public data, and I know IT people who work in the govt, hence I know what they make. I was looking for a job last year and know the range that private sector companies pay - it's lower than the govt range. (I was looking in the same area as the govt IT people I know, and I have approx. the same amount of experience as them.)
Here's a question for you - if private sector employees really do make $10K more than you, and have less responsibilities, why don't you apply for one of those jobs? You'd be happier (since you say you are pissed off). But the answer must be... that that higher-paying job with fewer responsibilities in the private sector doesn't exist.
If you're not making shit up, then why don't you apply for a federal job, since it pays so much more? The truth is that only people who have been feds for 30+ years get the top range of their salary band. I make the absolute minimum for my pay band, and most of my peers aren't much better off. And since they no longer give step increases in the FV system, I'll never get anywhere near that top range.
as for why I stay, well, there's a number of reasons, and most of them don't have anything to do with mone
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getting harder and harder to justify staying in the public sector
As someone working paying taxes in the private sector to pay public sector salaries, two points: glad to hear it and welcome to my world.
That's a very ignorant stance. First off, I pay taxes, same as you. SSI, Medicare, income taxes, the whole deal. Second, by paying low wages you sqeeze all of the talented workers out and leave only incompetent employees. Then you force agencies to hire contractors. Guess what? Contractors cost twice as much, because you're paying the same pay or higher, and then the contracting company has to get its cut. The right way to handle government bloat is to stop punishing efficiency, allow managers to fir
These Surveys Can't Be Taken Seriously (Score:3)
I'll believe it when it hits my own pocketbook.
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"Yeah, but the fudge factor due to self-selection bias and mis-reporting is probably pretty similar year-vs-year, so even if the absolute number is BS, it can still be a useful to compare to relative to prior years."
Not a bad point, but I don't know of any cases where it was done that way.
This will sound insensitive (Score:5, Interesting)
But do heed the advice: get off your ass and change jobs every now and then. I changed jobs twice during the crisis. Good people are always in demand. If you want more than sub-inflation raises (or no raises at all), get off your butt and see if you can find something better. With luck, you will. If you don't try, you definitely won't. As simple as that.
Re:This will sound insensitive (Score:4, Informative)
I agree with this part. I've drastically increased my pay by switching jobs in the past few years.
Big word of warning... If you post a resume to job sites, expect an absolute FLOOD of horrendous and useless calls from Indian "recruiters". If a single word in your resume matches any keywords for a job, expect a couple calls about it. Doesn't matter what job you say you're looking for, doesn't matter if you checked that you aren't willing to relocate.
I averaged a dozen calls every day for over a month after updating my resume on a couple job sites. I've gotten hundreds and hundreds of e-mails, and all of a handful have even been possibilities (right job title, not two states over). Large states are the worst (California), because these useless foreign idiots that call themselves recruiters don't check a map, and just assume if it's in the same state, it's a reasonable driving distance, and that's even the ones who are (barely) trying... I get spammed about jobs all over the country.
This is a new phenomenon to me, and seriously risks making posting your resume a fool's errand, or worse. It's so bad that just posting your resume with a cell phone number runs the real risk of causing you to lose your current job as you are inundated with calls.
Worse, employers are getting flooded by insane numbers of resumes from completely unqualified applicants. The weapon of choice seem to be requiring a recruiter to meet candidates in person before submitting them for consideration, which is quite the nightmare when your recruiter could be located 200 miles away... suddenly you need to take a day off work just to be allowed to SUBMIT a resume for consideration, which is the case with a number of companies. And just watching job sites doesn't work, as a huge number of jobs aren't ever listed on such job sites.
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So, once again, we have a lottery winner brag and advice everyone to play. This might sound insensitive, good for you that it worked out, but it was not because you were "good", and other people may be much less lucky. Given the way most companies treat employees nowadays, if, God forbid, they get a wind of you looking for another position, through either posting your resume on the jobs site, or just expressing your interest on social network or privately, you will be on their shitlist and be dropped like h
Not just one number (Score:4, Interesting)
Salaries going "back to 2008 levels" does not take into account the benefits that you have all lost. Every one of you is paying more for health care, higher deductibles, higher co-pays. Your employers don't contribute as much to your measly 401ks that won't be nearly enough to retire on anyway.
Don't get me wrong, it's good that there are signs of life in the economy, but we've got 2 percent growth and 4 percent continual federal stimulus. If the federal government should stop the stimulus, you're going to lose ground in a hurry. This isn't going to change in 2012 or 2013 or 2014 no matter who is elected. There are structural problems in the US economy, in the WORLD economy that aren't going to change and there really isn't any path to improvement as long as a relative handful of transnational corporate entities and bank holding companies continue to act as a self-appointed world government.
Re:Not just one number (Score:5, Insightful)
There are structural problems in the US economy, in the WORLD economy that aren't going to change and there really isn't any path to improvement as long as a relative handful of transnational corporate entities and bank holding companies continue to act as a self-appointed world government.
Oh, it's much worse than you think. Much worse.
If the companies you're thinking of actually acted as a self-appointed world government, we wouldn't be in the mess we're in - they'd at least try to make sure their own backs were scratched, if nothing else. The trouble is, nothing any of those banks own is actually worth anything. To use a programming analogy, our entire financial sector is abstracted into oblivion. Every single "asset" on the books is tied to some value extracted from another "asset", which in turn is tied to some value extracted from yet another "asset", that, 15-20 links later, eventually leads to actual collateral. This is due to our banking sector deciding at some point that it could get better returns reselling every scrap of paper they bought among themselves to each other than they could by investing their money into capital creation.
To better explain this, pretend you're on an island with two other people. One of you is good at hunting pigs. Another one is good at harvesting coconuts. A third is good at fishing. Between the three of you, you all make enough food to feed everyone, frequently with a bit left over. However, each of you gets bored with what you get, so everyone decides to trade with one another. Trouble is, nobody can decide, say, how many pounds of pig a coconut is worth. So, the three of you decide to use a small shell on the island as money. It's colorful and thus easy to identify, it's rare, and it's portable. Perfect!
One day, you decide you want a week off from your pig hunting duties. So, you start hoarding shells to save up for your week-long vacation. You charge a bit more for your pig than usual, you buy a little less fish and coconut than usual, and you spend more time between pig hunts looking for shells. Finally, you decide you have enough saved up where you can take the week off, so you do so. You stop hunting pigs and immediately start using your hoarded shells to buy coconuts and fish.
Sounds good so far, right? Well, here's the thing - since you're taking the week off, food production just went down 33%. On top of that, the number of shells being exchanged between the three of you is the same as it was before you took your week off, only there's much less to buy. In short, everyone on the island - yourself included - is screwed.
So, what does any of this have to do with the banking sector? Well, instead of investing in, say, fish preservation techniques, salted pork, better fish hooks, or a longer stick to whack the trees bearing coconuts with (i.e. capital improvements that benefit everyone), they've been investing in shells for the past generation or so and now we're all paying for it. Fun times, eh? But don't worry - maybe if we replace the shells with "sound money", maybe some shiny rocks, this sort of thing won't happen again. We promise.
Which, by the 80/20 rule means.... (Score:2)
Maybe a bit better in Atlanta (Score:3)
Inflation and other issues (Score:3)
Did I miss whether these are "real" (inflation adjusted) figures? It's the critical factor as the salary squeeze is coming from inflation reducing the value of money which has not been offset by salary increases.
The article also errs significantly by using inconsistent terms for almost every single figure. "average boost", "average total increase", "total pay", "salary increase", "earn more", "total average compensation", "total salary", "take home", "make". I suspect the author is trying to avoid being repetitive with words but all of these words either mean different things or are vague and could mean many things.
Sure, I'm an accountant and maybe most people are quite reasonably going to interpret as intended, but it shows the author does not have knowledge of what he is talking about. "Salary" means the top number on the payslip, "take home" means the bottom figure in your payslip that goes into the bank, while "compensation" is the top number plus all benefits and bonuses. The differences on the basis used can be substantial, especially when you're analysing small movements of around 5%, never mind the 0.81%. A 5% salary increase could easily be wiped out by cuts in non-salary compensation and is a cut in real terms if not adjusting for inflation.
The relevant consideration is remuneration or compensation, in real terms. These account appropriately for benefits in kind, deductions and bonuses. You can get away with ignoring that in normal times by assuming there isn't much movement, but in current times it's a widespread way to cut payroll costs without hurting the headline salary rate.
Even then, if your pension is a money purchase scheme we're only looking at pensions in terms of the employer contributions. You personally are very likely still much worse off due to the fall in the current value of your plan and the fall in it's expected growth rate. Usually this will be through no fault, action or inaction of your employer, but nevertheless you're losing out due to the economic conditions. Furthermore this should put upward pressure on salaries as workers seek to increase contributions while maintaining their take-home pay. Even if all else was equal except that salaries were increased to exactly offset increased contributions which were set at a level to exactly offset the pension plan decline, the figures would arguably be misinterpreted because while yes they would accurately show an increase in compensation offered by employer, there would be a nil change in compensation enjoyed by the employee. This matters when you start calling people "winners" when actually they just lost less than the others.
I'm making 20% less... (Score:3)
... than I did in 2008. I left a good, but boring job to go to a company that hired me to manage a big ERP project, then a week after I started they canceled the project and 7 months later I was laid-off. I was an idiot that let a weasel of a CIO completely fool me. It took me almost 5 months to find a new full-time gig and a 20% lower salary was the best I could find in Southern California.
Companies are using contractors and temps more than ever before, and because of the number of people still out looking for jobs, they are paying less for those resources than they have in many years. So, the placement firms are offering much less to the contractors - with absolutely zero insurance & benefits. From the perspective of your average CIO, he doesn't need to invest in his internal staff - he can just bring in contractors that he can swap in and out based on the specific tech skills he needs. When the project goes wrong (which it will when it is staffed by people who know nothing about your business) he can blame the contractors and the project manager.
Even the small internal IT staff that is kept for maintenance & local sysadmin duties is not immune - there is no reason to invest in their training and career path - you can just swap them out whenever you decide to change technologies. If you are replacing Goldmine with Salesforce.com, don't bother training your current staff (that has given you many years of excellent work) on Salesforce - just lay them off and hire people who already know Salesforce.com, then repeat & rinse in a few years when the next shiny new toy is released.
Bottom line: Now, more than ever before, IT employees are considered tech monkeys that can be swapped out and "traded-up" (a term used by my last weasel of a CIO) just like the HW & SW they work on. That might be OK for young, single IT geeks - but not for people who are trying to provide for their family. Get out now, while you can!
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Re:Yay! I'm above average. (Score:5, Insightful)
Exactly why this type of survey is so absurd.
Comparing a work from home sysadmin's salary with an enterprise architect's salary is like trying to get an average salary for lawyers (add one public defender to a credit default swap lawyer, divide by two.)
IT jobs cover a lot of space. $78K/year is just a silly summary statistic.
Re:Yay! I'm above average. (Score:5, Insightful)
WHich is why trying to use the term "IT" for all of these different jobs is stupid. They're completely different categories with no meaningful relationship. Break it into two groups (programming/architects and network admin/system admin/help desk) and you at least break it into functional groups that do the same thing (although still only marginally useful, as help desk is usually paid so much less). But doing anything across both groups at once is pointless, it only serves to confuse people.
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I guess I'm the outlier (or rather, sucker) out there ruining the numbers for the rest of you folks.
Re:Yay! I'm above average. (Score:5, Interesting)
1. Employment levels are down, so you have to factor in all the IT workers who are either making $0, or delivering pizza. The article states that companies are continuing to replace full-time workers with contract or part-time hires.
2. Self-selection bias - those who make less are much less likely to report how much (or how little) they make;
3. Venue bias - this survey covers only mid-sized and large-sized companies -- whole swaths of people working in both smaller businesses (the majority of jobs in the economy) or the lower end of the industry are not included in these surveys, so they don't "drag the numbers down."
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The first link - notice what they call an "IT JOB"? See the pretty picture on the left side - they consider selling cell phones as an "IT Job" because it's somehow it-related. They're pulling their numbers for future expectations out of their collective rectums, based on things like the number of job board postings, which is a negative, not positive, correlation, as I will explain below.
The second link quotes the same dice.com survey. And it adds one necessary data point - that the reason for the "sho
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